Tribunal admits insolvency application under Section 9, appoints Resolution Professional

The Tribunal admitted the application under Section 9 of the Insolvency and Bankruptcy Code, 2016, finding a default in payment by the Corporate Debtor for operational debt owed to the Applicant. Despite the Corporate Debtor's claims of a pre-existing dispute, the Tribunal determined that the debt was undisputed and appointed an Interim Resolution Professional. A moratorium was imposed on the Corporate Debtor, and directions were given for the resolution process, emphasizing the adherence to the Code's provisions.

---

---

Issues:
1. Application filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 for initiating Corporate Insolvency process.
2. Dispute regarding non-payment of operational debt by the Corporate Debtor.
3. Establishment of default in payment by the Corporate Debtor.
4. Existence of pre-existing dispute between the parties.
5. Appointment of Interim Resolution Professional.
6. Direction to deposit a sum with the Interim Resolution Professional.
7. Imposition of moratorium on the Corporate Debtor.

Analysis:
1. The application was filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 by AF Consult India Pvt. Ltd. against Sikkim Hydro Power Ventures Limited for non-payment of operational debt. The Applicant, a consultancy services provider, had invoiced the Corporate Debtor for services rendered, which remained partially unpaid, leading to the initiation of the insolvency process.

2. The Corporate Debtor claimed a pre-existing dispute regarding the quality of services provided by the Applicant. However, the Tribunal found that the Corporate Debtor did not dispute the operational debt due and payable, which was more than one lakh rupees. The Tribunal referred to the broad definition of default under the Code and admitted the application based on the established default in payment.

3. The Tribunal examined the documents and submissions from both parties and concluded that the default in payment had indeed occurred. Despite the Corporate Debtor raising concerns about the quality of services, the Tribunal noted that the debt was not disputed, and the application was complete, leading to its admission under Section 9(5) of the IBC, 2016.

4. Regarding the appointment of an Interim Resolution Professional, Mr. Diwan Chand Arya was appointed by the Tribunal, subject to certain conditions. The Tribunal directed the Operational Creditor to deposit a sum with the Interim Resolution Professional to cover expenses related to the insolvency resolution process.

5. The Tribunal imposed a moratorium on the Corporate Debtor as per Section 14(1) of the Code, prohibiting certain actions during this period. The terms of Sections 14(2) to 14(4) were also invoked, ensuring the proper administration of the insolvency resolution process. The Registry was instructed to communicate the order to all relevant parties and authorities for compliance.

This detailed analysis of the judgment highlights the key issues addressed by the Tribunal and the legal implications of the decision in the context of the Insolvency and Bankruptcy proceedings.

---